Mechanisms underlying normal and defective mammalian development are under study in the mouse, by means of three experimental systems: (1) Allophenic mice, in which cells of different genotypes (e.g., normal and defective) are made to coexist from early cleavage onward, are being used to elucidate the developmental basis for certain genetically caused diseases. These include macrocytic and microcytic anemias, strain- specific autoimmunity, and neurological disorders involving myelination deficiencies. (2) Transplantable testicular teratomas, containing pluripotential stem cells, are providing in vitro opportunities to trigger some kinds of cellular differentiation under controlled conditions. These cells offer novel possibilities for examining the characteristics of the undifferentiated state and the regulation of commitment to specialization. Ovarian teratoma cells of parthenogenetic origin are also under investigation, in an attempt to derive a haploid mammalian cell line. (3) The events responsible for embryo implantation are under study. A hormone-controlled proteolytic enzyme system of uterine origin is apparently critical for successful implantation. We are continuing our efforts to characterize this proteinase and to define its mode of action, particularly on the cell-surface glycoproteins of the developing embryo.